Acquisitions of Certain Financial Institutions 1.23 Paragraph 5 of FASB Statement No.

147, Acquisitions of
Certain Financial Institutions, provides that “[t]he acquisition of all or part of a financial institution that
meets the definition of a business combination shall be accounted for by the purchase method in
accordance with FASB Statement No. 141, Business Combinations.” Footnote 1 of Statement 147 defines
the term “financial institution” as including “all or part of a commercial bank, a savings and loan
association, a credit union, or other depository institution having assets and liabilities of the same types
as those institutions.” Paragraph 1 of Statement 147 excludes transactions between two or more mutual
enterprises (see 1.24) from its scope. Combinations Between Two or More Mutual Enterprises 1.24
Appendix C of Statement 147 defines the term “mutual enterprise” as “[a]n entity other than an
investor-owned entity that provides dividends, lower costs, or other economic benefits directly and
proportionately to its owners, members, or participants. Credit unions are an example of a mutual
enterprise.” 1.25 A combination between two or more mutual enterprises is within the scope of
Statement 141. However, paragraph 60 of Statement 141 states: For combinations between two or
more mutual enterprises, this Statement shall not be effective until interpretative guidance related to
the application of the purchase method to those transactions is issued. [Footnote 24] Footnote 24
provides that “[t]he Board intends to consider issues related to the application of the purchase method
to combinations between two or more mutual enterprises in a separate project.” Until the FASB issues
further guidance, combinations between two or more mutual enterprises should be accounted for
under the guidance in APB Opinion No. 16, Business Combinations. Formation of a Joint Venture 1.26
Paragraph 9 of Statement 141 provides that “[f]or purposes of this Statement, the formation of a joint
venture is not a business combination. [While footnote 6 of Statement 141 states that the Board plans
to address the accounting for joint ventures in another project